A licensee in BC discovers that their client may be using a real estate purchase to launder proceeds of crime. Under both RESA and FINTRAC obligations, what must the licensee do?
Correct Answer
D) File a Suspicious Transaction Report with FINTRAC, avoid tipping off the client, and consult the managing broker on next steps
When a licensee has reasonable grounds to suspect money laundering, they must file a Suspicious Transaction Report (STR) with FINTRAC as soon as practicable. The licensee must not tip off the client that a report has been filed (tipping off is a criminal offence). They should also consult with their managing broker about compliance obligations and whether to continue the engagement. Under RESA, licensees have professional obligations that may require withdrawal from the transaction.
Why This Is the Correct Answer
Option D is correct because when a licensee has reasonable grounds to suspect money laundering, they must: (1) file a Suspicious Transaction Report (STR) with FINTRAC as soon as practicable; (2) not tip off the client about the report (tipping off is a criminal offence under PCMLTFA); and (3) consult with their managing broker about compliance obligations and appropriate next steps, which may include withdrawal from the transaction. This balanced approach fulfills reporting obligations while protecting the investigation.
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A BC licensee receives a $50,000 deposit cheque, payable to their brokerage, from a buyer. Under the Real Estate Services Act, when must the money reach the brokerage trust account?
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